TIDMADME
RNS Number : 9675D
ADM Energy PLC
27 June 2023
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014 (WHICH FORMS PART OF
DOMESTIC UK LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT
2018). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE
INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
27 June 2023
ADM Energy PLC
("ADM", the "Group" or the "Company")
Final Results, Publication of Annual Report and Notice of
AGM
ADM Energy PLC (AIM: ADME; BER and FSE: P4JC), a natural
resources investing company, announces its audited full year
results for the 12 months ended 31 December 2022.
Aje Field, OML 113
-- In July 2022, PetroNor E&P Limited's ("PetroNor")
completed its acquisition of Panoro Energy ASA's ("Panoro")
interest in OML 113
-- In August 2022, completed the 17(th) Lifting at the Aje Field
totalling 94,187 barrels with a net share of 8,683 barrels to ADM,
which equates to ADM's profit interest of approximately 9.2%
-- JV Partners are progressing development plans for the Aje
Field, including replacement of the Floating Production Storage and
Offloading ("FPSO"), and as a result there is currently a pause in
production
Post period, Investment in Onshore US Oil Leases and Work
Programme
-- Invested in five oil leases through an acquisition of Blade Oil V, LLC for US$1,614,000 (the "acquisition"). The focus of the acquisition is one lease in the Midway-Sunset Oilfield, one of the largest fields in the US
-- Primary focus of US portfolio is a 70.0% working interest
participation in an initial three well drilling programme to target
shallow oil production on the Altoona Lease
-- Concurrent with the acquisition, ADM has entered into
subscription agreements to issue secured convertible loan notes
("SCLN") with an aggregate face value of up to US$1.5 million
Corporate and Financial Highlights
-- Made directorate changes with appointments of Stefan Olivier
as CEO, previously co-founder of MX Oil plc (now ADM Energy plc),
and Claudio Coltellini as Non-executive Director
-- Revenue was GBP0.7m (2021: GBP1.8m)
-- Operating costs reduced by 81% to GBP0.4m (2021: GBP1.9m)
-- Loss before and after tax was GBP2.1m (2021: GBP2.5m)
-- In January 2022, the Company completed an equity fundraising
of approximately GBP561,000 with Optima Resources Holding
Limited
-- In October 2022, the Company completed an equity fundraising
of approximately GBP725,000 through a subscription and loan from
OFX Holdings, LLC (formerly TN Black Gold, LLC) ("OFX")
Stefan Olivier, CEO of ADM Energy, said: " Having recently
joined ADM, I am really excited about the period that lies ahead of
us. Since becoming CEO, we have been honing our strategy, which
focuses on identifying investment opportunities that are near-term
producing assets in proven oil and gas jurisdictions to enhance our
investment portfolio. In light of this, I am very pleased that we
have already made our first investment, acquiring Blade V which
owns a portfolio of North American Oil and Gas assets in a highly
prospective region. We are hugely excited to add these assets to
our investment portfolio and the opportunity to add significant
value for shareholders.
"Looking forward, we are aiming to progress both the development
plans at Aje alongside the JV partners, as well as developing these
new North American assets. Consequently, both the Board and I can
see a great opportunity to bring value to ADM and its shareholders
and we look forward to updating the market on our progress on these
milestones in due course."
Annual Report and Accounts and Notice of AGM
The Company will shortly be publishing its Annual Report and
Accounts including a Notice of AGM. These will be made available on
the Company's website at www.admenergyplc.com . The AGM is to be
held at the offices of Shakespeare Martineau, 60 Gracechurch St,
London EC3V 0HR at 10.00 a.m. on 25 July 2023.
Enquiries:
ADM Energy plc +44 20 7459 4718
Stefan Olivier, CEO
www.admenergyplc.com
Cairn Financial Advisers LLP +44 20 7213 0880
(Nominated Adviser)
Jo Turner, James Caithie
Hybridan LLP +44 20 3764 2341
(Broker)
Claire Louise Noyce
ODDO BHF Corporates & Markets AG +49 69 920540
(Designated Sponsor)
Michael B. Thiriot
Gracechurch Group +44 20 4582 3500
(Financial PR)
Harry Chathli, Alexis Gore, Henry Gamble
About ADM Energy PLC
ADM Energy is a natural resources investment company with oil
and gas assets in Nigeria and the US. We hold a 9.2% profit
interest in the Aje Field, part of OML 113 in Nigeria. We also hold
a portfolio of interests in oil and gas projects, the primary focus
of which is a 70.0% working interest participation in an initial
three well drilling programme to target shallow oil production on
the Altoona Lease, in the Midway-Sunset Oilfield, California, the
third largest oil field in the US.
We are seeking to build on our existing asset base and target
other investment opportunities across the West African region in
the oil and gas sector. These will be based on attractive risk
reward profiles such as proven nature of reserves, level of
historic investment, established infrastructure, route to early
cash flow and exploration upside.
Operating Review
ADM's strategy focuses on identifying investment opportunities
that are near-term producing assets in proven oil and gas
jurisdictions to enhance our investment portfolio.
Acquisition of Blade V
In May 2023, ADM invested in a portfolio of interests via the
acquisition of Blade V from OFX Holdings LLC (Formerly TN Black
Gold, LLC ("OFX"), a total maximum consideration of
US$1,614,000.
Blade V owns a portfolio of interests in oil and gas projects,
the primary focus of which is a 70.0% working interest
participation in an initial three well drilling programme to target
shallow oil production on the Altoona Lease located in the
Midway-Sunset Oilfield, Kern County, California.
The Midway Sunset Oil Field has produced in excess of 3 billion
barrels of oil since production began in 1889. It is the largest
known oilfield in California and the third largest in the United
States. Chevron Corporation has been operating in the San Joaquin
Valley for over 100 years and its interests in the area represent
its core, onshore USA assets. The Altoona Lease is a highly unique
opportunity for a small company to benefit from substantial
investment and de-risking of the target opportunities by a major
company. Surrounded by Chevron on three sides, the project is a
direct beneficiary of the infrastructure and pipelines built to
service Chevron's production in the area.
In addition, the interests held by Blade V comprise:
-- 100.0% working interest in the Schweitzer Lease in Graham
County, Kansas where a work-over programme to restore production
from two wells is currently in process.
-- 50.0% fully funded working interest in a three well workover
programme in Texas targeting initiation of production from three
wells.
-- 50.0% working interest in the Pearson, Oberlin and Moon
Leases, a three well workover programme.
-- Total gross and net leasehold acreage associated with the
acquisition is 423 acres and 295.5 acres, respectively.
-- ADM will be a non-operating financial investor in the interests.
Further information regarding the Blade V portfolio can be found
in the acquisition announcement of 25 May 2023. Details of ADM's
interests are as follows:
Lease/Well County, Working Net Revenue Operator (1)
State Interest Interest
------------ ------------ ---------- ------------ -----------------
To Be Determined
Altoona Kern, CA 70.0% 52.5% (1)
Pearson Grimes, TX 50.0% 37.5% Guardian (2)
Oberlin Upshur, TX 50.0% 37.5% Guardian (2)
Moon Upshur, TX 50.0% 37.5% Guardian (2)
Schweitzer Graham, KS 100.0% 75.0% Tex Oil, LLC(3)
Notes:
1. Altoona: a California licensed and bonded contract operator to be determined by OFX and ADM.
2. Guardian Energy Operating Co., LLC is a registered Texas operator 75.0% owned by OFX.
3. Tex Oil, LLC is a registered Kansas operator.
The acquisition of Blade V ties into my vision for ADM to expand
our investment portfolio by bringing in quality, near term
production assets with low risk and high upside that can add
significant value to the Company.
Aje Field
In July 2022, the Joint Venture development of Aje took an
important step forwards when PetroNor E&P Limited ("PetroNor")
announced that it had completed the purchase of 100% of Aje
Interests of Panoro Energy ASA ("Panoro"). PetroNor agreed to
acquire Panoro's interest in OML 113 for an upfront consideration
of USD 10 million, with a contingent consideration of up to USD
16.67 million based on future gas production volumes. The
completion of a purchase of interests in Aje from an established,
heavyweight partner such as PetroNor demonstrates the strong value
proposition posed by the asset. With the transaction completed, the
next stage will be for the JV Partners to agree on the long-term
field development plans for the Aje Field.
Discussions are continuing with the JV partners regarding plans
to replace the current Floating Production Storage and Offloading
("FPSO") to increase gas handling capacity and support development
plans to monetise the field's significant wet gas potential, which
is estimated at potentially 1.2 trillion cubic feet of wet gas
resources.
In August 2022, the 17th lifting at the Aje Field was carried
out for a total of 94,187 barrels with a net share of 8,683 to ADM.
This lifting was drawn from oil previously stored on the FPSO as
there was no oil production from the Aje Field (Aje-4 and Aje-5) in
2022. As previously announced, the JV partners implemented a
suspension of production at Aje to upgrade the FPSO and increase
the capacity and production capability in line with the development
plans.
Barracuda
ADM is currently following legal proceedings in respect of its
interest in the Barracuda oil field. As announced on 13 December
2021, the Company and K.O.N.H. (UK) Ltd ("KONH") obtained an
interim injunction at the Federal High Court of Nigeria, Lagos
("Court") restraining Noble Hill-Network Limited ("NHNL"), its
officers, agents, privies, or person howsoever connected from
selling, disposing, divesting, or tampering with the 70%
shareholding interest of KONH in NHNL to third-party investors or
in any other manner whatsoever. The interim injunction continues to
stand.
During the period, the Company announced the result of the CPR
on the Barracuda Field with a 2U (P50) case, the NPV10 is +$99mm
with an IRR of 45%, assuming at least 70mmbbls STOIIP is
discovered.
Following the appointment of a new CEO (and subsequent
investment and focus on developing the Blade V assets) and the
protracted legal proceedings and settlement discussions, the
management team and Board have made the decision to write-down the
investment in Barracuda for prudence.
New leadership and board changes
The Board was pleased to appoint Stefan Olivier as CEO in April
2023, replacing former CEO, Osa Okhomina. Stefan has extensive
corporate broking and oil and gas experience, including as the
co-founder of MX Oil plc, now ADM Energy. He played a pivotal role
in securing and financing the participation of ADM in the Aje field
and in securing the support of OFX prior to its initial investment
in the Company.
Stefan has been on the Boards of several other public and
private companies and brings years of experience of working in
natural resources. He will drive forward our strategy of building a
multi-asset portfolio, as evidenced in his short time here by the
acquisition of Blade V.
The board was also strengthened by the addition of Claudio
Coltellini as Non-executive Director. Claudio has invested in the
U.S. oil and gas sector for approximately 15 years and is CEO of
four private US oil and gas companies focused on investment in the
states of Texas, California, Kansas and Louisiana, and well placed
to share his expertise to help capitalise on the Company's
acquisition of Blade V.
Financial Review
For the year ended 31 December 2022, the Group's revenue
decreased by 62.2% to GBP0.7 million (2021 GBP1.8 million),
reflecting the suspension of production at Aje.
Operating costs decreased by 80.5% to GBP0.4 million (2021
GBP1.9 million).
Decommissioning provision amounted to GBP1.6 million (2021
GBP1.3 million). Depreciation & amortisation expense increased
by 38.3% to GBP0.07 million (2021: GBP0.05 million).
Administrative expenses decreased by 26.3% to GBP1.7 million
(2021: GBP2.3 million). Finance costs increased to GBP0.12 million
(2021 GBP0.06 million).
Loss after taxation decreased 16.5% to GBP2.1 million (2021:
GBP2.5 million loss). The Directors do not propose a dividend (2021
GBPnil).
As of 31 December 2022, the Group had cash and cash equivalents
of GBP0.025 million 31 December (2021 GBP0.3 million).
Funding
The Company raised a total of GBP1.29 million through two
fundraises in 2022. In January 2022, the Company raised a total of
GBP561,000 through a subscription with Optima Resources Limited,
with funds used for general working capital expenditures. In
October 2022, the Company then raised approximately GBP725,000
through a subscription and a loan from OFX Holdings, LLC (formerly
TN Black Gold, LLC) ("OFX") . The subscription raised a total of
GBP500,000, combined with a $250,000 loan facility.
In May 2023 the Company announced, alongside the acquisition of
Blade V, that it has entered into subscription agreements to issue
secured convertible loan notes ("SCLN") with an aggregate face
value of up to US$1.5 million, of which US$900,000 has been
subscribed for and US$600,000 remaining available for subscription.
The SCLNs subscriptions have been received and no SCLNs will be
issued until cash has been received. The SCLN has a three-year
term, an interest rate payable-in-kind (which maybe settle with
cash or non-cash payments) of 8.0% per annum and the principal
together with any interest due may be converted at any time at a
share price of 1.2p per share.
In addition to the subscriptions, the Company agreed with
certain directors and creditors to convert outstanding contractual
liabilities of GBP683,117 into 56,926,417 new ordinary shares in
the Company at the price of 1.2p per new ordinary share.
Going Concern
At 31 December 2022, the Group recorded a loss for the year of
GBP2.12m and had net current liabilities of GBP2.13m, after
allowing for cash balances of GBP25k. In 2022 the company raised
GBP1.29m through two fund raises. In May 2023 the Company
announced, alongside the acquisition of Blade V, that it has
entered into subscription agreements to issue secured convertible
loan notes ("SCLN") with an aggregate face value of up to US$1.5
million, of which US$900,000 has been subscribed for and US$600,000
remaining available for subscription. The SCLN has a three-year
term, an interest rate payable-in-kind (which may be settled with
cash or non-cash payments) of 8.0% per annum and the principal
together with any interest due may be converted at any time at a
share price of 1.2p per share. In addition to the subscriptions,
the Company agreed with certain directors and creditors to convert
outstanding contractual liabilities of GBP683,117 into 56,926,417
new ordinary shares in the Company at the price of 1.2p per new
ordinary share, helping the company reduce the liabilities on the
balance sheet. Also with the change of management the focus of the
company is now on finding near term producing assets so the company
can start earning revenue. In May 2023 the company announced the
investment in Blade V which holds an interest across 5 different
wells in USA, all with near term revenue potential. As part of this
deal, the company also has circa $251k available under its debt
facility with OFX.
The Directors have prepared cashflow forecasts for the period to
June 2024 to assess whether the use of the going concern basis for
the preparation of the financial statements is appropriate. In the
short term, between the loan facility, potential revenue and CLN
proceeds the Group does not expect to need short term funding to
meet its liabilities as they fall due however the group does expect
in the period that more funding might be needed. The Directors have
a reasonable expectation based on past performance and current
discussions of support from stakeholders that additional finance
would be available should it be needed. Accordingly, the directors
consider it reasonable to prepare the financial statements on the
going concern basis.
Outlook
ADM has undergone a period of change, reflected in the recent
additions to our management team and the acquisition of Blade V,
that has solidified the Company's foundations.
Blade V provides ADM with an exciting portfolio of oil and gas
assets including acreage in one of the largest oil fields in North
America, a tier-one jurisdiction. The acquisition, and its
significant potential upside, can be a gamechanger for ADM and we
are excited by the opportunity ahead of us. The coming year will be
an important period as we progress the well drilling programmes at
Blade V and the JV partners progress with plans for Aje.
In addition to our current portfolio, we think the strength and
experience of our Board and technical team places us in an ideal
position to capitalise on new opportunities as they arise,
particularly as recent global events this past year have
underscored the vital importance of stable global oil and gas
supply. The Company and the Board is confident that it can
effectively leverage its knowledge and expertise across its
portfolio to generate value for the Company.
Group Income Statement and Statement of Comprehensive Income
For the year ended 31 December 2022
2022 2021
Note GBP'000 GBP'000
Continuing operations
Revenue 3 662 1,751
Operating costs (369) (1,895)
Administrative expenses (1,723) (2,340)
Impairment of investment 11 (576) -
Operating loss 4 (2,006) (2,484)
Movement in fair value of investments - -
Finance costs 5 (116) (56)
Loss on ordinary activities before taxation (2,122) (2,540)
Taxation 7 - -
Loss for the year (2,122) (2,540)
--------------------------------------------- ----- -------- --------
Other Comprehensive income:
Exchange translation movement 1,339 141
--------------------------------------------- ----- -------- --------
Total comprehensive income for the year (783) (2,399)
--------------------------------------------- ----- -------- --------
Basic and diluted loss per share: 8
From continuing and total operations (0.8)p (1.6)p
Group and Company Statements of Financial Position
As at 31 December 2022
GROUP COMPANY
2022 2021 2022 2021
Notes GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------- ------ --------- --------- --------- ---------
NON-CURRENT ASSETS
Intangible assets 9 17,899 16,149 - -
Investment in subsidiaries 10 - - 12,343 12,335
Fixed asset investments 11 - 576 - 576
17,899 16,725 12,343 12,911
---------------------------------- ------ --------- --------- --------- ---------
CURRENT ASSETS
Investments held for trading 12 28 28 28 28
Inventory 13 36 33 - -
Trade and other receivables 14 22 130 17 130
Cash and cash equivalents 15 25 110 25 109
---------------------------------- ------ --------- --------- --------- ---------
111 301 70 267
---------------------------------- ------ --------- --------- --------- ---------
CURRENT LIABILITIES
Trade and other payables 16 2,240 1,534 2,207 1,515
Convertible loans 17 - 212 - 212
2,240 1,746 2,207 1,727
---------------------------------- ------ --------- --------- --------- ---------
NET CURRENT LIABILITIES (2,129) (1,445) (2,137) (1,460)
NON-CURRENT LIABILITIES
Other borrowings 17 287 247 287 247
Other payables 16 2,718 2,783 - -
Decommissioning provision 18 1,557 1,264 - -
---------------------------------- ------ --------- --------- --------- ---------
4,562 4,294 287 247
---------------------------------- ------ --------- --------- --------- ---------
NET ASSETS 11,208 10,986 9,919 11,204
---------------------------------- ------ --------- --------- --------- ---------
EQUITY
Share capital 19 11,194 10,267 11,194 10,267
Share premium 19 38,090 38,014 38,090 38,014
Other reserves 20 962 960 962 960
Currency translation reserve 630 (709) - -
Retained deficit (39,668) (37,546) (40,327) (38,037)
---------------------------------- ------ --------- --------- --------- ---------
Equity attributable to owners
of the Company and total equity 11,208 10,986 9,919 11,204
---------------------------------- ------ --------- --------- --------- ---------
Group Statement of Changes in Equity
For the year ended 31 December 2022
Exchange
Share Share translation Retained Total
capital premium reserve Other reserves deficit equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- -------- -------- ------------ -------------- -------- -------
At 1 January 2021 9,450 36,591 (850) 817 (35,006) 11,002
Loss for the year - - - - (2,540) (2,540)
Exchange translation
movement - - 141 - - 141
-------------------------- -------- -------- ------------ -------------- -------- -------
Total comprehensive
income /(expense)
for the year - - 141 - (2,540) (2,399)
-------------------------- -------- -------- ------------ -------------- -------- -------
Issue of new shares 817 1,517 - - - 2,334
Share issue costs - (94) - 27 - (67)
Issue of convertible
loans - - - 2 - 2
Warrants issued in
settlement of fees - - - 114 - 114
At 31 December 2021 10,267 38,014 (709) 960 (37,546) 10,986
Loss for the year - - - - (2,122) (2,122)
Exchange translation
movement - - 1,339 - - 1,339
-------------------------- -------- -------- ------------ -------------- -------- -------
Total comprehensive
income / (expense)
for the year - - 1,339 - (2,122) (783)
-------------------------- -------- -------- ------------ -------------- -------- -------
Issue of new shares 927 134 - - - 1,061
Share issue costs - (56) - - - (56)
Issue of warrants - (2) - 2 - -
Settlement of convertible
loans - - - (19) 19 -
At 31 December 2022 11,194 38,090 630 943 (39,649) 11,208
-------------------------- -------- -------- ------------ -------------- -------- -------
Group Statement of Changes in Equity
For the year ended 31 December 2022
Share Share Retained Total
capital premium Other reserves deficit equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------ -------- -------- -------------- -------- -------
At 1 January 2021 9,450 36,591 817 (35,770) 11,088
Loss for the period and
total comprehensive expense - - - (2,267) (2,267)
------------------------------ -------- -------- -------------- -------- -------
Issue of new shares 817 1,517 - - 2,334
Share issue costs - (94) 27 - (67)
Issue of convertible loans - - 2 - 2
Warrants issued in settlement
of fees - - 114 - 114
At 31 December 2021 10,267 38,014 960 (38,037) 11,204
------------------------------ -------- -------- -------------- -------- -------
Loss for the period and
total comprehensive expense - - - (2,290) (2,290)
------------------------------ -------- -------- -------------- -------- -------
Issue of new shares 927 134 - - 1,061
Share issue costs - (56) - - (56)
Issue of warrants - (2) 2 - -
Settlement of convertible
loans - - (19) 19 -
At 31 December 2022 11,194 38,090 943 (40,308) 9,919
------------------------------ -------- -------- -------------- -------- -------
Group and Company Statements of Cash Flows
For the year ended 31 December 2022
GROUP COMPANY
Note 2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ----- -------- -------- -------- --------
OPERATING ACTIVITIES
Loss for the period (2,122) (2,540) (2,290) (2,267)
Adjustments for:
Warrants issued in settlement
of fees - 114 - 114
Finance costs 5 116 56 116 56
Impairment of investment 11 576 - 576 -
Depreciation and amortisation 9 65 47 - -
Decommissioning provision 18 138 215 - -
Operating cashflow before working
capital changes (1,227) (2,108) (1,598) (2,097)
Increase in inventories - - - -
Decrease/(increase) in receivables 108 (21) 113 (21)
Increase/(decrease) in trade
and other payables 138 570 522 545
------------------------------------- ----- -------- -------- -------- --------
Net cash outflow from operating
activities (981) (1,559) (963) (1,573)
------------------------------------- ----- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Acquisition of subsidiary - (180) - (180)
Proceeds on disposal of investments - 850 - 850
Loans to subsidiary operation 8 - - (8) (19)
Net cash outflow from investment
activities - 670 (8) 651
------------------------------------- ----- -------- -------- -------- --------
FINANCING ACTIVITIES
Continuing operations:
Issue of ordinary share capital 19 1,061 1,406 1,061 1,406
Share issue costs 19 (56) (67) (56) (67)
Repayment of borrowings (328) (338) (328) (338)
Proceeds from borrowings 210 - 210 -
Net cash inflow from financing
activities 887 1,001 887 1,001
------------------------------------- ----- -------- -------- -------- --------
Net (decrease)/increase in
cash and cash equivalents from
continuing and total operations (94) 112 (84) 79
Exchange translation difference 9 (32) - -
Cash and cash equivalents at
beginning of period 110 30 109 30
C ash and cash equivalents at
end of period 15 25 110 25 109
------------------------------------- ----- -------- -------- -------- --------
Notes to the Financial Statements
For the year ended 31 December 2022
1 general information
The Company is a public limited company incorporated in the
United Kingdom and its shares are listed on the AIM market
of the London Stock Exchange. The Company also has secondary
listings on the Quotation Board Segment of the Open Market
of the Berlin Stock Exchange ("BER") and Xetra, the electronic
trading platform of the Frankfurt Stock Exchange ("FSE").
The Company is an investing company, mainly investing in natural
resources and oil and gas projects. The registered office and
principal place of business of the Company is as detailed in
the Company Information section of the report and accounts
on page 2.
The information included in this announcement has been extracted
from the Company's report and accounts and, therefore, references
and page numbers may be incorrect. Shareholders should read
the Company's report and accounts in full which will shortly
be found on its website.
2 PRINCIPAL ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation
of these financial statements are set out below. These policies
have been consistently applied throughout all periods presented
in the financial statements.
As in prior periods, the Group and Parent Company financial
statements have been prepared in accordance with International
Financial Reporting Standards, International Accounting Standards
and interpretations issued by the International Accounting
Standards Board (IASB) UK-adopted International Financial Reporting
Standards (adopted IFRSs). The financial statements have been
prepared using the measurement bases specified by IFRS for
each type of asset, liability, income and expense. The measurement
bases are more fully described in the accounting policies below.
The current period covered by these financial statements is
the year to 31 December 2022. The comparative figures relate
to the year ended 31 December 2021. The financial statements
are presented in pounds sterling (GBP) which is the functional
currency of the Group.
An overview of standards, amendments and interpretations to
IFRSs issued but not yet effective, and which have not been
adopted early by the Group are presented below under 'Statement
of Compliance'.
STATEMENT OF COMPLIANCE
New standards, amendments and interpretations adopted by the
Company
The company has applied the following standards and amendments
for the first time for its annual reporting period after 1
January 2022:
* Amendment to "IFRS 4 "Insurance Contracts - deferral
of IFRS 9" supports the companies implementing the
new IFRS 17 standard and it makes it simpler to
report their financial performances.
* The amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and
IFRS 16 "Interest Rate Benchmark Reform - Phase 2"
integrate the amendments made in 2019. The amendments
referred in phase 2, address issues that might affect
financial reporting when an existing interest rate
benchmark is replaced with an alternative benchmark
interest rate (i.e. replacement issue) and assist
companies in the application of IFRS when changes are
made to contractual cash flows or hedging
relationships due to the interest rate reform, and in
providing useful information to users of the
financial statements.
* The Amendment to IFRS 16, "Covid-19-Related Rent
Concessions beyond 30 June 2021" extends the period
of application of the 2020 amendment to IFRS 16,
relative to the lessees' accounting of concessions
granted as a result of Covid-19, by one year.
The adoption of the standards and interpretations described
above, already in effect at the date of this report, did not
have a material impact on the measurement of the Group's assets,
liabilities, costs and revenues.
3 GOING CONCERN
At 31 December 2022, the Group recorded a loss for the year
of GBP2.13m and had net current liabilities of GBP2.13m, after
allowing for cash balances of GBP25k. Production was suspended
at Aje in the year as part of the development and expansion
plans being undertaken at the field.
In 2022 the company raised GBP1.29m through two fund raises.
In May 2023 the Company announced, alongside the acquisition
of Blade V, that it has entered into subscription agreements
to issue secured convertible loan notes ("SCLN") with an aggregate
face value of up to US$1.5 million, of which US$900,000 has
been subscribed for and US$600,000 remaining available for
subscription. The SCLN has a three-year term, an interest rate
payable-in-kind (which maybe settle with cash or non-cash payments)
of 8.0% per annum and the principal together with any interest
due may be converted at any time at a share price of 1.2p per
share.
In addition to the subscriptions, the Company agreed with certain
directors and creditors to convert outstanding contractual
liabilities of GBP683,117 into 56,926,417 new ordinary shares
in the Company at the price of 1.2p per new ordinary share,
helping the company reduce the liabilities on the balance sheet.
Also with the change of management the focus of the company
is now on finding near term producing assets so the company
can start earning revenue. In May 2023 the company announced
the purchase of Blade V which holds an interest across 5 different
wells in USA, all with near term revenue potential. As part
of this deal, the company also has circa $251k available under
its debt facility with OFX.
The Directors have prepared cashflow forecasts for the period
to June 2024 to assess whether the use of the going concern
basis for the preparation of the financial statements is appropriate.
In the short term, between the loan facility, potential revenue
and CLN proceeds the Group does not expect to need short term
funding to meet its liabilities as they fall due however the
group does expect in the period that more funding might be
needed. The Directors have a reasonable expectation based on
past performance and current discussions of support from stakeholders
that additional finance would be available should it be needed.
Accordingly, the directors consider it reasonable to prepare
of the financial statements on the going concern basis.
4 EARNINGS AND NET ASSET VALUE PER SHARE
Earnings
The basic and diluted earnings per share is calculated by dividing
the loss attributable to owners of the Group by the weighted
average number of ordinary shares in issue during the year.
2022 2021
GBP'000 GBP'000
-------------------------------------------- ------------- ------------
Loss attributable to owners of the
Group
- Continuing operations (2,122) (2,540)
--------------------------------------------- ------------- ------------
Continuing and discontinued operations (2,122) (2,540)
--------------------------------------------- ------------- ------------
2022 2021
Weighted average number of shares
for calculating basic and fully diluted
earnings per share 252,369,021 155,014,671
--------------------------------------------- ------------- ------------
2022 2021
pence pence
-------------------------------------------- ------------- ------------
Earnings per share:
Loss per share from continuing and
total operations (0.8) (1.6)
--------------------------------------------- ------------- ------------
The weighted average number of shares used for calculating the
diluted loss per share for 2022 and 2021 was the same as that used
for calculating the basic loss per share as the effect of exercise
of the outstanding share options was anti-dilutive.
Net asset value per share ("NAV")
The basic NAV is calculated by dividing the loss total net
assets attributable to the owners of the Group by the number
of ordinary shares in issue at the reporting date. The fully
diluted NAV is calculated by adding the cost of exercising
any extant warrants and options to the total net assets and
dividing the resulting total by the sum of the number of shares
in issue and the number of warrants and options extant at the
reporting date.
2022 2021
GBP'000 GBP'000
-------------------------------------------- ------------ ------------
Total net assets of the Group 11,208 10,986
Cost of exercise of warrants 1,159 1,318
--------------------------------------------- ------------ ------------
Total net assets for calculation of
fully diluted NAV 12,367 12,304
--------------------------------------------- ------------ ------------
2022 2021
Number of shares in issue at the reporting
date 297,147,530 204,480,863
Number of extant warrants 26,748,410 31,581,012
--------------------------------------------- ------------ ------------
Total number of shares for calculation
of fully diluted NAV 323,895,940 236,061,875
--------------------------------------------- ------------ ------------
2022 2021
-------------------------------------------- ------------ ------------
NAV - Basic (pence per share) 3.8p 5.4p
--------------------------------------------- ------------ ------------
NAV - Fully diluted (pence per share) 3.8p 5.2p
--------------------------------------------- ------------ ------------
5 AGM
The Company will shortly be publishing its Annual Report and
Accounts including a Notice of AGM. These will be made available
on the Company's website at www.admenergyplc.com . The AGM
is to be held at the offices of Shakespeare Martineau, 60 Gracechurch
St, London EC3V 0HR at 10.00 a.m. on 25 July 2023.
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END
FR FFMLTMTJTBTJ
(END) Dow Jones Newswires
June 27, 2023 02:00 ET (06:00 GMT)
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